Clostridium absonum phospholipase C (Caa) is a 42.7 kDa protein, which shows 60% amino acid sequence identity with the Clostridium perfringens phospholipase C, or alpha-toxin (Cpa), and has been isolated from patients suffering from gas gangrene. We report the cloning and sequencing, purification, characterisation and crystal structure of the Caa enzyme. Caa had twice the phospholipid-hydrolysing (lecithinase) activity, 1.5 times the haemolytic activity and over seven times the activity towards phosphatidylcholine-based liposomes when compared with Cpa. However, the Caa enzyme had a lower activity than Cpa to the free (i.e. not in lipid bilayer) substrate para-nitrophenylphosphorylcholine, towards sphingomyelin-based liposomes and showed half the cytotoxicity. The lethal dose (LD(50)) of Caa in mice was approximately twice that of Cpa. The crystal structure of Caa shows that the 72-93 residue loop is in a conformation different from those of previously determined open-form alpha-toxin structures. This conformational change suggests a role for W84 in membrane binding and a possible route of entry into the active site along a hydrophobic channel created by the re-arrangement of this loop. Overall, the properties of Caa are compatible with a role as a virulence-determinant in gas gangrene caused by C.absonum.